Audi to open natural gas, hydrogen plant in 2013

Automaker plans to sell new natural gas-powered cars and dive into hydrogen research

By Clifford AtiyehMSN Autos

Audi will open a renewable gas plant that will produce natural gas and hydrogen by early next year, making it the first automaker to build and run its own facility for such fuels.

The new, 44,000-square-foot facility in Germany will use water- and solar-generated electricity to produce hydrogen, in a process commonly known as electrolysis. Typically, large-scale hydrogen production has been blocked by excessively high costs and low yields, due to the amount of electricity required and the small amounts of hydrogen that can be produced.

While Audi did not say if its process would be more efficient, it said it would combine the hydrogen with waste carbon dioxide from another nearby gas plant to create methane, which comprises more than 95 percent of natural gas found underground and within shale rock. The result: renewable, synthetic natural gas from an environmentally friendly production process.

Audi says it can produce more than 1,100 tons of synthetic natural gas and consume nearly 3,100 tons of carbon dioxide each year. That would be enough to power 1,500 new Audis running on compressed natural gas for 9,320 miles year. The A3 TCNG, Audi’s first natural gas-powered car, will go on sale in Europe in late 2013. A natural gas trim of the next-generation A4 will bow in 2015.

Company parent Volkswagen has been selling “bifuel” vehicles — cars that can run on either natural gas or gasoline — for many years across Europe, as has Mercedes-Benz, Opel and Ford, but such models cost thousands of dollars more than gas-only cars and represent a tiny silver of the market as compared to diesel.

Due to record-low fuel prices, natural gas-powered cars are beginning to expand in the U.S., with special versions of the Ram, Silverado, Sierra and F-150 pickups. But without incentives or a major refueling infrastructure, natural gas remains rare among light-duty vehicles. Hydrogen, in even scarcer amounts, is a complete pipe dream at this point.

But Audi’s plant is a big step that may accelerate these alternative fuels into the mainstream. Until now, only Honda has built and sold a production hydrogen car; Audi’s German rivals BMW and Mercedes-Benz are bit players.

Honda has sold the Civic Natural Gas since 1998, and its resulting expertise in high-pressure fuel storage led it to sell the first production hydrogen fuel-cell car, the FCX Clarity, since 2008. Toyota has said it plans to market a similar hydrogen-powered car by 2015 and continues to run an experimental fleet of hydrogen-powered Highlander vehicles in the U.S. General Motors ran a fleet of 100 hydrogen-powered Equinox vehicles during a three-year demonstration from 2008 to 2011.

BMW used to run several 7-Series models on liquid hydrogen, as opposed to the fuel’s natural gaseous form, to demonstrate how conventional internal-combustion engines can be so equipped. So far, BMW hasn’t made progress in putting the car into series production. Mercedes-Benz is leasing the hydrogen-powered F-Cell, based on the European B-Class, to roughly 70 people in Los Angeles and San Francisco, where the highest concentration of public hydrogen stations — about 26 — are located.